Skip to main content

tv   Fast Money Halftime Report  CNBC  August 15, 2012 12:00pm-1:00pm EDT

12:00 pm
blink of eye kind of move and that's what traders think about here. >> people calling for 1% and 2% on the ten-year and we're somewhere in between. that does it for us here on this wednesday as we hit noon. let's get back to headquarters and the "fast money" halftime. >> thank you. welcome to the halftime show. four hours to go until the close. this is where we stand on the street. mixed market picture. nasdaq is up by about a half percent or so. s&p with fractional gain. dow ran out of steam. it's within 100 points or so. we continue to watch all of the markets for you. this is what we're following on halftime today. forget qe-3. goldman says don't bet on more action from the fed. can stocks keep running without big ben's help? taking aim at apple. samsung unveils the latest tablet and does it have the right stuff to take a bite out of the ipad? we're trading the big movers today with a great panel. jon najarian and pete najarian. our top story, friending
12:01 pm
facebook. some of the biggest whales on the street revealing sizable stakes in the embattled social media company with the stock down. is it finally time to get in? pete, you are in. and we don't know if some of these guys have reduced some of the stakes or what. >> and in some cases i think i read somewhere where some of these folks were even in before the ipo. in any case, we're seeing that we are finally starting to know there are a lot of folks that are still excited about facebook or at least so we think that they are. i can tell you, the option paper over the last couple of sessions just continues to be very, very bearish or they are buying some protection. in either case, you are seeing a lot of puts trading and a lot of folks that are still expecting that there could be some downside to this name. >> josh brown, the big guy is in. should the little guy get in? >> the big guy is not in. if you actually do the math --
12:02 pm
first of all, 13 apps 45 days after the close of the quarter. what this is reflecting is a sales trader hooked up and maybe this thing was like a gift. it's not a large amount of stock. less than .25% of their total size of their fund. i would not take this as a sign that large hedge fund managers are buying. i would ignore that part of the sto story. if in fact they have this lockup and we can see the stock hold the $20 level, that would be bullish. people in at this point are not willing to sell. i would let that storm pass and let's see what happens. it's almost worth paying up. >> jon najarian, what do you do with facebook right now? you're in it also. >> yeah i am. i'm following up on that carl quintanilla thing. i'm in this one. i've been in it since the stock
12:03 pm
broke 20. i bought the stock not below 20 but i did that one by two spread, i think this one could see a little upside move here. the fact that reid hastings put $100 million into it and a host of other folks have scrambled it to buy pieces, i agree with josh brown, that's not the reason to jump in. it's not bad that smart folks that know this lockup is coming tomorrow are still willing to get in. i agree if we don't go down and break that level again, 20 roughly, i think that we're more likely to see the mid to upper 20s on this move and that's what i'm playing for. >> i totally agree with that. watch that level. if they hold it, it's very constructive. >> forget stevie cohen, doc, you're the big guy i was referring to who is in this name. >> swinging that big stick. >> joe what do you do with
12:04 pm
facebook? >> first of all, i think it's tradeable. i think from an investment standpoint which was what we were sold on back in may, the fundamentals have now proven that in a longer term positioning, it's not really warranted at this point. i just think it's a trading vehicle. i think it's going to trade between 18 and you have to look at the july 26th to 27th price gap which exists between 24.54 and 26.73. a tremendous amount of inventory for sale. that's going to be your resistance. >> tomorrow is a huge day for facebook investors as we said. the first of four lockups expires meaning millions of shares potentially hitting the market. so what can we expect and what's the best play on other social media companies? let's welcome in venture capitalist bill gurley. welcome back to halftime. great to have you. what do we expect tomorrow? facebook hasn't traded well. will that influence the level of
12:05 pm
insider trading that we see? >> it could. any venture capitalist that has large stake has the ability to make the decision on how much to distribute at any given point in time. it's an option and not a requirement. and so if they feel like their firm will be better positioned by holding on and maybe getting past some of the lockup concerns, getting into january or february of next year, they may choose to do that. >> what do you think will happen? >> i think there's going to be a lots of noise. maybe even through the rest of the year because of lockup releases and people talking about tax policy and whether that would affect people selling. sometime between now and then someone is going to wake up and say this is the largest site on the internet. they have a very high quality management team. they have over a billion users. half of which log in every day and probably one of the strongest competitive modes i have ever seen. i think people will wake up and start moving into the stock
12:06 pm
sometime between now and the end of the year. >> you spent time on wall street as a research analyst. is the stock undervalued right now at $20 and change? >> you know, i haven't built a bottom's up model. looking at the other work people have done, you can see a buck a share and so like i said, once all of this noise goes away and people start looking at their portfolio and where their he n exposure is, i think people will start more laikely to move in than to move out. >> josh has a question for you. >> my question would be doesn't it make more sense to investors to look past these big fat consumer names that there is too much noise and figure out which technology companies are enabling all of the social media activity, names like fusion io, rat space, palo alto, networks. wouldn't that be a more constructive thing to research
12:07 pm
than to try to figure out groupons and facebook and linkedin. >> first of all, i don't think it's an either/or proposition. the public media is grouping companies like groupon and facebook together makes no sense to any whatsoever. one is a coupon distributor. it seems like everyone is just referring to any tech company that went public in the last 18 months as a social network company. i think there's really only two public ones right now. >> what's been the problem with social media stocks in general? you can take groupon specifically. that has obviously not traded well. zynga hasn't traded well either. >> i don't think either of those companies are really social networks. from my percespectiveperspectiv network is a company whose user value proposition is a function of who's in the network.
12:08 pm
i get much better experience on linkedin or facebook because my friends are there. i don't have that same thing happening with groupon. and so i think they are very different companies. linkedin has traded extremely well as we know. facebook over the test of time will prove that as well. a lot of the other models don't have barriers to entry that the other two companies have and i think it's odd that people have been grouping these things together. >> we'll expand on that topic. let's stay on facebook if we could for another moment. why do you think the stock has traded as poorly as it has? who is to blame for all of this? we just had a discussion in the last hour about the second market whether they are to blame for overvaluing these stocks to begin with before they become publicly traded companies. >> certainly in the world i live in, the most out of balance kind of supply and demand around
12:09 pm
pricing of financial assets has been late-stage private. it started about 18 months ago. i would say it really started when miller made an incredible trade, investment in facebook at $10 million which is a strong return today. a lot of copycats came into the game. facebook is not the only example. groupon and zynga had rounds done privately that are way higher than where any of those stocks sit today. they are unquestionably was a bubble in late stage private markets and i think those trading points and those valuations certainly got in the way of what happened in the facebook case. >> it's interesting. zynga didn't trade on the second market but it was valued and probably priced largely on facebook to some respects. even if you don't trade in the private or second market, you can still have issues like we do
12:10 pm
with quote/unquote social companies companies. >> i would like to think that problem is behind us. you know, when you have -- there was a private round at zynga done at 14. when you have late-stage private investors investing at 14 and stock is trading where it is today, you would like to think there's lesson learned and some of that behavior will stop. >> we'll do more on social media coming up. we'll talk google, apple, samsung, mobile payments. all on the way more with bill gurley and life without more easing from the fed and if stocks can rally without a nudge from big ben. the world's largest smartphone maker unveils its new galaxy tablet. what this could mean for apple ipad and its sales.
12:11 pm
how do you know which ones to follow? the equity summary score consolidates the ratings of up to 10 independent research providers into a single score that's weighted based on how accurate they've been in the past. i'm howard spielberg of fidelity investments. the equity summary score is one more innovative reason serious investors are choosing fidelity. get 200 free trades today and explore your next investing idea.
12:12 pm
12:13 pm
welcome back.
12:14 pm
shares of staples getting slaughtered today. it's a stock that's been on herb greenberg's radar for quite a while and he joins us with traders now. this has gone from the hen house to the outhouse. >> that's one way of looking at it. i can argue i got it wrong. what i mean by that is i tweeted out today. i said this is the stock i thought would be the last man standing in this entire space. now when i look at office depot, office max and staples it's going to be no man standing if this trend continues. one of my good sources was saying this is going from cyclically challenged. they are down 41 basis points. if every basis points count, we're talking half a percentage point. that's huge. you go down what they talked about. steep decline in computer sales. contract business down. keeping customers but at a price. then they talk about the
12:15 pm
competitive world out there and need to look at pricing. they are getting killed from online guys. >> they are getting killed from amazon. isn't that the -- you talk about competiti competitive challenges. >> they didn't say we're killed by amazon. it matters what you guys say? >> they are killed on paper consumption demand which is contracting. >> paper and ink. ink down 2%. paper down 6%. the trend is going to continue not by the way a good sign for hewlett packard. >> don't you think there's a little bit with target and walmart and other places where people can go and do shopping. you brought up amazon. online story there. i think their competition is far more than that. >> they are talking about contract businesses from 100 to 500 people. a big part of their business. that's being hit too. those people are either just cutting back on what they're purchasing or going elsewhere. >> stock is a straight sale. as you say, everyone in the institutional side is the only thing you can own margins up to
12:16 pm
this point were strong. now the margins are beginning to contract. that's problematic going forward. this is stock that's going under $10. >> what do you do with this one? >> there's no one day event on individual stocks. you hear me say it all the time. i'm not a buyer on the first dip of this one. as joe says, if this thing did push down to 10, i would get interested. i don't know if it gets that far in tomorrow's session. i guess i wouldn't be surprised. >> give it a chance. 11 and change and looks like it's going down fast. >> 54 million shares today. >> highest since january of 2009. >> there's coverage here because the value guys now are going to take a hard look at it and you have now a 3.3% dividend yield. i'm not saying i would buy -- >> it sounds like hewlett packard. >> it does not sound like hewlett packard. the value guys will not step and
12:17 pm
buy it given what's going on in credit default. >> they will not step in and buy it. >> you have my colleague over at "street signs" being a buyout candidate a few days ago. when you look at it and look at the balance sheet, it's not the same as some of the others. >> not quite. good stuff. talk to you again soon. herb greenberg. samsung launching the latest imp pad kp ipad competitor. cnbc's john fort has details. i saw pricing came out a short time ago. >> that's right. looks like 499 for entry level version equal with ipad though the screen resolution isn't as good. they are doing two important things. one, they are touting it as a creative tool because of pen and put technology built in which flies in the fast of apple's strategy which focuses on finger
12:18 pm
input and simplicity. this goes into the ecosystem with the popular smartphone. samsung's itunes play even though it's not about media. note 10.1 has the feature where the screen stays bright when it knows you're looking at it and plays video in small window when doing other things. they are pulling those users to a tablet. we'll see if that's working. >> you tell me this is priced the same basically as the ipad is? >> yeah. same size at that 10-inch size and the entry level version is at the same price. we'll see where they go with any kind of lte wireless versions. the screen resolution isn't as good but it does have pen input. they are trying to come at the same market with different features. >> am i wrong -- >> you're disappointed. >> i'm just surprised. if you are trying to eat into apple, why price something the same as the ipad? what's the incentive for someone
12:19 pm
to go away from the i ipad? >> especially when you know apple has refresh cycles. we know about the iphone 5. we'll hit that soon. when you look at everything happen apple, you look at the ecosystem. the only thing holding apple back is because the five isn't out yet. that will get pushed into the next quarter. those numbers will be outrageous. >> bill gurley still with us, the new product priced the same as ipad, what is your first thought? >> i'm surprised as well for all of the reasons you mention plus the android being basically free as a component inside. i would expect a lower price point. i suspect you will see it over time and they probably just didn't want to start there. >> how about in this whole battle samsung and google versus apple. you have the trial going on now with apple and samsung. can anybody really take a sizable bite out of apple's business in either the tablet or the smartphone space?
12:20 pm
>> well, i do think it is the biggest thing going on in high tech. this is the new platform. smartphones are projected to pass internet computer users and it is a big, big deal, whoever wins this battle. google is playing an unfair game by scorching earth request a free os that makes it very tough to compete with. i think the thing that you have on the android side is not just samsung, but hundreds of other hardware manufacturers building toward that platform and whether it's the samsung is the best one executing today but someone is going to hit price points that apple is not going to be able to hit. >> do not count samsung out though. do not count samsung out because of this price point. one thing i want to point out here, other people trying to get in at this ten-inch size, say it's a big deal that samsung is matching the price. the pen does have features that
12:21 pm
apple doesn't bring into entry level. if they can pull over a fraction of those customers into their tablet, they'll actually be quite a significant competitor in tablet. who knows how it will turn out. don't count them out. >> that's a fair point. jon najarian has a question. before we get there, pete, you have been critical of google in the fact that they continue to give android away. >> they get market share but they sound like nokia that had great market share at one time. look at apple. $14 in data from every single phone, that says a lot to me. that's a real number when you talk about 30 plus million per quarter they're going to sell these phones. >> the question is, is he missing the point? is it about the mote as you said earlier? >> i think google is playing defense and not offense here and want to make sure to control search as we move from one platform to the other and they've done a fantastic job at
12:22 pm
it. it's probably the most aggressive defensive business move i have ever seen. >> i agree with bill. that's exactly what it is. defensive move. the fact this is not a retina display on that ipad that samsung is launching means it's boring. this will not make any inroads with apple given that you can get the retina display with the ipad, the new ipad, not ipad 13 b and you don't get it with samsung. pen input, nobody wants that except some samsung executives. nobody wants that pen input at all. right now what we're hearing is at that trial bill that some of the very high level, i've heard even perhaps ceo to ceo are speaking at that samsung apple trial right now to perhaps offer a settlement rather than go to the jury because that's one of those things that could be a
12:23 pm
blind side incident if either ceo were to blink and maybe they will indeed settle rather than put it to the jury. what do you think about that? >> i think it's very possible. people have been saying out here that the highest building materials of the smartphone is likely to be the patent payment that you are making to microsoft or apple or samsung or whoever wins in this case. it's a very important part of what's happening in the smartphone market. >> we'll keep you around. we want to talk to you about mobile payments. what's the next biggest thing in technology that you have your eye on. we'll do that on the other side of the break. you have heard from traders and now we want to hear from you. who will win the big tech battle? tweet us and we'll air some of your responses later in the show. coming up, cisco reports earnings after the close. buy and sell arguments for the tech bellwether when we come back.
12:24 pm
how do you know which ones to follow? the equity summary score consolidates the ratings of up to 10 independent research providers into a single score that's weighted based on how accurate they've been in the past. i'm howard spielberg of fidelity investments. the equity summary score is one more innovative reason serious investors are choosing fidelity. get 200 free trades today and explore your next investing idea. [ male announcer ] when this hotel added aflac
12:25 pm
to provide a better benefits package... oahhh! [ male announcer ] it made a big splash with the employees. [ duck yelling ] [ male announcer ] find out more at... [ duck ] aflac! [ male announcer ] ♪ ha ha!
12:26 pm
anyone have occasional constipation, diarrhea, gas, bloating? yeah. one phillips' colon health probiotic cap each day helps defend against these digestive issues with three strains of good bacteria. approved! [ phillips' lady ] live the regular life. phillips'. welcome back. cisco set to release earnings
12:27 pm
after the bell. pete, we know the stock. this is a stock that wall street has loved to hate up until last week when goldman put it on its conviction buy list and piper upgraded it as well. >> and goldman had 24 target. we're talking about a 17.20 stock when goldman made the move. >> is john chambers going to give the payoff with good numbers? >> i don't know we'll get anything exciting and in the options market yesterday, they told us that. they weren't thrilled in august. a split between calls and puts. if you went to september, people suspect there is something they will release that will give people optimism and maybe move this stock to the upside. 10 to 1 calls were trading yesterday. that's a real number. so yesterday they were sort of positioning. today they are positioning. don't expect a monster move. >> the stocks had a bounce here into the month here up 2% at the highs of the day today. what do you expect? >> you know, sentiment definitely appears to have
12:28 pm
shifted here both in terms of the way the stock is acting and what the sell side is saying. i think they'll hit the number but they have a pretty good history of managing that correctly. the single biggest problem with the stock and the reason why it's so overdue to make a nice break and break the long-term downtrend is they have no respect for shareholders. they continue to issue stock options and then do buybacks that don't really do anything for the bottom line other than cover up the issuance of stock options. if they get to the point where they are serious about shareholder value and driving that, then they'll do something with that $48 billion in cash other than mask the issuance of employee stock options. that has to stop or this thing will never move. >> bill, when you were a research analyst, did you cover cisco or no? >> i did not. >> i won't ask you about what you think about john chambers then. let's talk about mobile payments. the fight over the way you pay is heating up again. a group of retailers including
12:29 pm
walmart, target and lowe's say they are creating a joint payment network which takes aim at existing methods. what do you think about this? last week was a big deal when starbucks and square announced this partnership. now it seems to have gotten a little bit bigger when you have names like of which we're talking about today where you have more validation i guess. >> i think all of the technology is in place so that we ought to be able to walk into any store or visit any website on our mobile phone and have a one click experience. everyone expects that to happen now. there are a lot of people who could be disrupted if they don't have a seat at the table when that happens. i'm not surprised by what you mentioned. there's companies like google, microsoft, walmart, that really should care about what's about to happen here.
12:30 pm
i think you're going to see a lot of positioning. i think you'll see a lot of different companies try a lot of different things. i wouldn't count on amazon who is clearly a leader in one click experience and has started to experiment with letting third parties use amazon one click off of amazon. >> are you guys benchmark investors on companies that are capitalizing on this move? >> we are. you can bill to phone so they are doing hundreds of millions in payments across that network today. >> which companies are you following in this space? >> we have talked about nxpi. that's the chip that will allow this to happen. i think visa and mastercard are winners in this environment. they are toll collectors. >> they are the ones who got hit hard on the starbucks square deal. >> how about the idea of the security side of things too? the fact that intel made that
12:31 pm
big move and they are in that security software area, that's probably one of the issues that people are always concerned with. >> i also have just been marveling at the increased interest in ebay because of the paypal and because of this mobile payment discussion. that's up 9% just in the last three days or maybe it's four days ebay is running from 43.70 to 46 and change. that's a nice move. that's one i would continue to watch. that's my favorite in the space. >> quickly before we get you go, bill, do you own shares of facebook either personally or in another capacity? >> yeah. we own benchmark capital is the single largest investors in instagram. that transaction has not closed yet but that leaves us exposed. >> you are obviously positive about the prospects for facebook going forward. let me steer your attention to twitter. you guys were obviously early
12:32 pm
investors into twitter. how does the facebook situation -- put us in the minds if you will of what's happening at twitter and how they think about a possible ipo and how this entire facebook situation has impacted the decision making over there. >> from my perspective, they are at different points in the life cycle. i don't think they are spending time worrying about how the facebook ipo went. i think the world at large is slowly discovering that these are two very separate assets. you know, look since we've been on the air together you mentioned the word twitter or said the word tweet probably 20 times. it's a different things. it's a communication network. it's a broadcast network. it's very different from the one to one photo sharing and social network that facebook is. i think the world is starting to understand that more and starting to understand what twitter is. the company is doing extremely
12:33 pm
well internally. ad product is having a big impact on the company. they are coming into their own. >> do you think it caused them to slow down the thought process in any way in thinking about going public? >> it's possible. you can say that about any company in silicon valley. >> great to have your incisight. let's hit biggest pops and drops in midday trading. am.m abercrombie and finch is popping. >> the stock is increasing. >> still on the low end of the range. >> target popping 2%. >> long the stock and we like everything we saw at this earnings report. beat by 11 cents. entering canada for the first time ever this fall. i think if you looks at what they do in stores like fresh food, these are great ideas that carry higher margins.
12:34 pm
>> they raised stocks near five-year high. starbucks? >> gladly a tactical bounce for those that stayed long the stock as it continued to decline after earnings. give me 50 print on this one and i'll be out of it. >> rgr is dropping today 4.3%. >> keybank cut them because of the outlook for arms makers in particular sturm ruger taking it hard today. 4.5% drop. >> a drop for cheating if ever there was a pop for it. one participant in national scramble championship had a few tricks up his sleeve. unidentified player was booted from the board game after he allegedly snuck in blank tiles which can be used as wild card letter. another contestant spotted the offense which spelled trouble for the cheater as he was promptly removed from the
12:35 pm
tournament. >> a little carrie underwood talking about cheating. >> how to invest your money if the fed decides not to do more easing and billionaire hedge fund manager john paulson going for gold. what we found in his 13-f filing. more halftime is up next. mamama
12:36 pm
12:37 pm
12:38 pm
welcome back. paulson's most recent filing says the fund owns 28 million shares or 5% of the etf's total float. is this a signal to get in on paulson's back? >> let me say this about golden on a show that's called "fast money," this may sound inflammatory but gold is nothing more than a long-term investment tool. those that tried to trade it, i traded gold futures for many years, what john paulson is doing and others being tactical in the gold trade is the wrong way to play it. i suspect they will be proven wrong. >> we can talk long-term investment ideas on this show all day long. >> think the thing with miners that paulson probably sees, don't forget what his background
12:39 pm
is. there's a great arm here if you think think there will be a revision. both gold and s&p are up 30%. if you look at gdx, that's actually down close to 15. so you might get this idea that at a certain point this thing has to catch up. the problem with this trade is it hasn't worked yet. number one. number two, underneath it all, these are not leverage plays on gold. they are actually gold at a discount because of how poor management is. they tend to issue shares and hedge wrong. i don't like the trade. if you think ecb will print and fed is going to print, you are better with physical combined with stocks believe it or not rather than miners. >> yields on ten-year touching a high of 1.8%. incredible climb from record low of 138 hit late in july. the move comes amid improving economic data but does it also mean qe-3 is off the table? let's bring in fidelity
12:40 pm
investor. >> thank you for having me. >> so over at goldman sachs today don't bet on qe-3. are you playing that same tune today? >> yes, i am. i think the fed has not done unconventional easing. spread is above two and some of the economic data has come in better. they say economic surprise index and weekly leading index, et cetera. i also think the fed has basically run out of ammunition unless it has another trick up its sleeve like unlimited qe based on nominal gdp growth targets or something like that. we've had this response from investors since 2009 to jump whenever the words qe are mentioned. it's better to focus on china and europe. >> isn't that ywhy we have jumpd to where we are largely because
12:41 pm
of expectation of central bank easing? >> in part it's due to ecb up be rhetoric on pulling out a big gun over there. i think it has less to do with the fed. it has a little bit to do with the fed. if you look at gold at 1,600 now, it was 1,620 back in june when s&p was at 1,269. i would expect gold to rally more if it was truly a qe rally. i think it has more to do with short covering by microhedge fund community which are short equities. >> can you speak to china? it sounds like you're actually leaning not to a soft landing but maybe a hard landing of china. >> yes. the official numbers are about 7.6% gdp growth. if you look at antidotal data, iron orr, et cetera, i think you are looking more at single mid single digits at the most. if you define a hard landing as
12:42 pm
6% or less growth, which for china would be the definition, i think china is a hard landing. you can see that in the s&p earnings numbers. >> let's say you're right and fed does not do qe-3. do you think the stock market can go higher as long as the ecb delivers? isn't that the biggest wild card in all of this and takes the fed off the hook? >> absolutely. i would imagine that the fed is hoping that the ecb will do heavy lifting for it. the question is ecb has raised expect achations quite dramatic and that's driven a lot of the rally. can they deliver on higher expectations is the question and frankly i have my doubts. >> where do you see the stock market here in the united states just based on what your thought process is about global stimulus from central banks. >> i think the stock market is sort of levitating here. almost eerie. the market is barely moving.
12:43 pm
everyone is on vacation. volatility is low. we're seeing this good rally of 11% off june lows on low volume, diverging technicals, nonconfirmations by a number of indicators such as copper and dollar index and gold and treasury yields have risen about 20, 30 basis points. other indicators which i usually look to for confirmation are where we were when the s&p was below 1,300. my fear is the market has gotten ahead of itself here based on unrealistic expectations of qe. >> good to have your insights on the show today. good to have a new face with us. >> i don't know why it is not that we can't point out what bernanke really looks at. i think bernanke looks at the marketplace itself. qe-1 was reaction to a market that was deteriorating.
12:44 pm
qe-2 you had s&p that was at 1250 down to 1050. now in may we were 1415. we're right at 1405. the market is bailing ben bernanke out here that's why you won't get qe-3. >> brian shackman is watching all with a market flash. >> what's this one going to be? >> i wonder. this is about captain kirk or the negotiator. take a look at priceline stock about 1.4%. after seven months and maybe not such a good ad campaign he's back with priceline. maybe he was just upset that he has a lot of priceline stock and earnings took a major beating. nice pop here. he's returning with a new spot. i guess he's in a suit and tie with a surfboard and pants rolled up saying surfing is his life now. he's not dead as he fell off that cliff in his last ad. >> thanks. can he solve the european debt
12:45 pm
crisis? >> i don't know if he can. >> priceline issue is european economy and being able to sell hotel rooms. >> slowing here and there but i think bringing him back entertainment factor he actually does mean something to the company and could actually add a little something but certainly it's not going to solve anything. >> nice pop today. okay. coming up, the worst drought in the nation's history creating some unique opportunities. we'll tell you the businesses seeing green when halftime returns.
12:46 pm
12:47 pm
12:48 pm
today on extra dry special edition of power lunch, the doubt of 2012. we're dedicated our second half hour to the devastating drought out in the midwest. we'll look at the crop loss, how low river levels are impacting shipping and how it's hitting prices in the supermarket. which companies are actually in a position to benefit? we're also going to look at how we got here and when it might just end. sue herrera will join us live from the cme in chicago for our special coverage. scott, now back to you and fast half. >> we look forward to that. see you in ten minutes. you've been tweeting us all hour with thoughts on the growing battle between apple, google and
12:49 pm
samsu samsung. >> usually when we ask our twitter audience to compare apple with another company, apple wins hands down. sentiment is changing. let's get straight to the tweets. apple wins the race but samsung will crush other mobile manufacturing companies. look at htc. louis says google is busy buying distressed companies while samsung lacks apple cachet and trader says google is the tech titan because they don't have to deliver a hit product every six months to keep investors excited and if yesterday you saw google it was trading near 4 1/2 year high. this quarter alone up 15% versus apple which is up just about 7%. scott? >> interesting. how about that? that last one about google. interesting thought there. >> let's look at google at the beginning of the year near the
12:50 pm
same four-year high. they have come back. 670 thereabouts. apple today is 630. you talk about performance. that's performance.630. talk about performance, that's performance. >> okay. coming up, the historic drought creating opportunitying for u.s. businesses. yak i can is in kentucky with more on that story. jackie? >> hey there, scott. you're exactly right. while some businesses are seeing challenges as a result of the drought others are making money off of providing solutions like here at american water. we'll tell you about that company and a few more coming up after the break. ♪
12:51 pm
why not take a day to explore your own backyard? with two times the points on travel, you may find yourself asking why not, a lot. chase sapphire preferred. there's more to enjoy. anyone have occasional constipation, diarrhea, gas, bloating? yeah. one phillips' colon health probiotic cap each day helps defend against these digestive issues with three strains of good bacteria. approved! [ phillips' lady ] live the regular life. phillips'.
12:52 pm
welcome back. the nation's historic drought isn't hurting everyone. some companies are profiting
12:53 pm
from it by providing solutions. cnbc's jackie deangelis is at american water river station. jackie? >> that's right, scott. here at american water, they're doing exactly that, profiting on the bottom line providing solutions. the water increased and added roughly 6% to 9% to the bottom line last quarter. the company also raised its full-year guidance 22 cents saying 70% 0 of that is weather related. we are in kentucky at american water's treatment facility. it was built two years ago in response to the drought and adds more efficiency and capacity to serve the surrounding area and why it's important. american water's ceo says that the company would be hard pressed to have met customer needs without it this year. also, benefiting, some of the irrigation companies. farms with them this year seen a measurable impact. one example that we learned of a
12:54 pm
tennessee corn farm harvesting 225 bushels of corn a day with an irrigation system in place. a neighboring farm that didn't have it was harvesting 100 bushels a day less. meantime, you need to watch the space closely including lindsay manufacturing and belmont industries. possible beneficiaries if farmers choose to invest for next year. finali finalistly an analyst suggested other companies should the drought continue. as the drought continues to plague the nation, these are the ones to watch. back over to you. >> thanks so much. jackie deangelis. special coverage of the drought is taking place all day today across the networks of nbcuniversal. our traders watching the story closely. brian kelly, one of them with a realtime trade today. what are you looking at? hey, judge, i'm looking at in
12:55 pm
gr, corn products, cpo the old symbol. they sell corn starch and sweeteners and seeing demand of asia and they're able to raise their prices in this environment so their margins are expanding. they're really actually benefiting from this environment. >> thanks so much. ingr. and talk to you soon, brian kelly. what do you see about deere? earnings were just a disaster. >> i'm glad you bring that up. u.s. ag equipment sales supposed to be higher, offset europe and asia. they're not. think about the situation going on with corn production. who makes up the shortfall? the brazilians. case new holland, agco. they have the exposure selling the equipment to the brazilians. those are the plays. >> jb, deere's in play today. caterpillar with action because of the deere disappointment. >> yeah. these are -- i mean, caterpillar and deere high quality companies
12:56 pm
and long-term investor you want to buy them at weak points in the cycle and i don't know if we're definitely there. i think the adco idea is interesting. they're very heavily entrenched in brazil and important because it's a sugar crop, et cetera. might be a more niche idea and let the deere thing settle out. >> all right. we are back on the other side of this break. we'll go around the horn and get final trades. [ male announcer ] at scottrade,
12:57 pm
you won't just find us online, you'll also find us in person, with dedicated support teams at over 500 branches nationwide. so when you call or visit, you can ask for a name you know. because personal service starts with a real person. [ rodger ] at scottrade, seven dollar trades are just the start. our support teams are nearby, ready to help. it's no wonder so many investors are saying... [ all ] i'm with scottrade.
12:58 pm
wanted to provide better employee benefits while balancing the company's bottom line, their very first word was... [ to the tune of "lullaby and good night" ] ♪ af-lac ♪ aflac [ male announcer ] find out more at... [ duck ] aflac! [ male announcer ] [ yawning sound ]
12:59 pm
check this out. be sure to watch "fast money" today. there he is, carl icahn, he'll talk about the latest corporate coup. don't want to miss at


info Stream Only

Uploaded by TV Archive on